This is a rush transcript from "Hannity," January 7, 2014. This copy may not be in its final form and may be updated.

(BEGIN VIDEO CLIP)

NEW YORK CITY MAYOR BILL DE BLASIO: We are called to put an end to economic and social inequalities that threaten to unravel the city we love.

(APPLAUSE)

DE BLASIO: And so today, we commit to a new progressive direction in New York.

DE BLASIO: We will ask the very wealthy to pay a little more in taxes so that we can offer full-day universal pre-K for every child in this city.

DE BLASIO: We will require big developers to build more affordable housing.

DE BLASIO: And we'll expand community health centers into neighborhoods in need so that New Yorkers see our city not as the exclusive domain of the one percent.

DE BLASIO: Social and economic justice will start here and will start now.

(END VIDEO CLIP)

SEAN HANNITY, HOST: To each according to his need, from each according to their ability, just a small glimpse of New York City mayor Bill De Blasio in his widely controversial inaugural address. Now, the Big Apple's new chief executive -- he took progressivism now to a whole new level, and his call to action is raising a lot of eyebrows.

Here to respond to those remarks for the very first time, former New York City mayor Rudy Giuliani. By the way, that little tax he's talking about is, what, a thousand dollars a person.

RUDY GIULIANI, FORMER NEW YORK CITY MAYOR: It's -- the thing that I find the most offensive was the attack on Mayor Bloomberg during the -- during the inauguration.

HANNITY: Yes, that was awful.

GIULIANI: There have been many inaugurations and ex-mayors sitting there, whatever. I mean, those attacks were vicious.

HANNITY: Awful.

GIULIANI: They were mean. They were mean-spirited. And really, the mayor is owed an apology. He -- he -- he -- whether you agree with Mayor Bloomberg completely or you didn't, he was a good mayor. He worked his -- he worked tirelessly for the city --

HANNITY: He did a lot of good things. It's the nanny state stuff that --

GIULIANI: OK. All right. So you never agree with anybody completely. But he left a city that's in good condition. And to be characterized as a plantation, that's outrageous, absolutely outrageous!

Also, I'm getting really annoyed at this concept of progressive. There's absolutely nothing progressive in this class warfare stuff. It's retrogressive. Every single policy that they're talking about is a policy that has failed several times historically, going back 130, 140 years.

We're talking about, basically, Marxist ideas. We saw them used in Eastern Europe. We saw them used in Asia. We saw them used -- I took over a city that was a disaster! First thing I did was lower taxes, not raise taxes. The next thing I did is require people on welfare to work. I said, "If you want your welfare check, you have to work." And I said to them, "I'm going it for your good."

HANNITY: How many people got off welfare?

GIULIANI: (INAUDIBLE) I took off welfare? How about 500,000 to 600,000!

HANNITY: Wow! I mean, that's -- that's --

(CROSSTALK)

GIULIANI: And I would like to emphasize the fact that I started a year before Newt Gingrich and Bill Clinton --

HANNITY: The Contract.

GIULIANI: -- did welfare reform.

HANNITY: Yes.

GIULIANI: So it wasn't -- this wasn't a spin-off of -- if anything, the person I borrowed it from was Governor Thompson in Wisconsin. He was my -- he was my model. And then we used it. We called it "workfare." The New York Times viciously attacked me for doing this.

And I said, you know, What I can give you that will get you out of poverty is not redistribution of wealth, which is a Marxist idea that has failed. What I can give you -- here's something new. I can give you a chance to keep the work ethic.

HANNITY: He said, "We don't ask more of the wealthy to punish success. We do it to create more success stories." Now, help -- help people understand because I don't think people that live outside of New York understand -- we got, all right, federal taxes 39 percent?

GIULIANI: Right.

HANNITY: OK. State taxes --

(CROSSTALK)

GIULIANI: Actually, with all the -- 41 percent.

(CROSSTALK)

HANNITY: All right, so let's say 40. State taxes in New York, top rate nice percent, 9.5?

GIULIANI: And then you put in the city, it becomes 12 to 13 percent with the surcharge.

HANNITY: So that -- in other words, so that would be --

(CROSSTALK)

HANNITY: That's 52.5 percent.

GIULIANI: Right. Then if you -- if you -- if you consider that you can deduct your state and local taxes, your effective tax rate is about 45, 46, 47 percent.

HANNITY: But that doesn't include -- hang on -- a county tax.

GIULIANI: Oh, no, no, no!

GIULIANI: Doesn't include property tax.

(CROSSTALK)

GIULIANI: You are -- in New York, you are the junior partner in your earnings. The government is the senior partner.

(LAUGHTER)

HANNITY: By far.

GIULIANI: Right.

HANNITY: So 60 cents of every dollar is about right.

GIULIANI: You're working -- you're not working for you and your family mostly. You're working for everybody else mostly.

HANNITY: What about --

GIULIANI: And these are concepts -- the point that I'm trying to make, Sean, is, that they -- these are presented as new ideas. These are all ideas that have failed. They were at the heart of why this city was a disaster in 1993, 1994. They were at the heart of why the city had 10.5 percent unemployment, why the city had a deficit of $2 billion to $3 billion, things that I turned around and things that Mayor Bloomberg expanded on.

And we changed it by reducing taxes. We changed it by requiring accountability from people on welfare. Nobody -- nobody says that people on welfare are lazy. What happens when people are given things is they can fall into a loss of the work ethic. That can happen. That's been demonstrated. That's why we had to --

HANNITY: Most people want to work, I think.

GIULIANI: Most people want to work, but they can lose that over a period of time. So what you want to do is you want to fight to keep them in the workforce.

How about -- if the mayor wants to do something good, how about setting up a workfare program and getting 30,000 to 40,000 people -- I had 40,000 people working for New York City who were on welfare. Now, the unions don't like that. I mean, if you're owned by the unions, you can't do that.

HANNITY: They put the big rat (ph) that --

GIULIANI: But if you're owned by the city of New York --

HANNITY: Yes.

GIULIANI: -- you can do it.

HANNITY: Yes. What -- what do you think -- how long does it take before you think the negative impact of these policies -- because New Yorkers -- you're right, this has all been tried before, and it's been tried in New York. How long before people --

GIULIANI: It'll take -- it'll take longer than you think because Mayor De Blasio has taken over, despite all that rhetoric, which was horrible, about the city and the condition of the city -- he's taking over a city that Mayor Bloomberg has left, you know, all the fundamentals --

HANNITY: Pretty good shape.

GIULIANI: -- in pretty darn good shape. It's like taking over a business that's doing really well. Before you can deteriorate it, it's going to take a while.

I hope he changes his mind. I hope and pray, and I'm optimistic about the fact that I hope he becomes practical. One of the things that can happen to you as a mayor, it can make you practical. Ed Koch was one of the most liberal members of the House of Representatives when he became mayor, and he became an extraordinarily practical and very conservative mayor.

Now, sometimes it happens. We had the example of President Obama, who probably has gone more to the left --

(CROSSTALK)

GIULIANI: He's gone more to the left. So we're going to have to see what happens. But these ideas are not progressive ideas. These are retrogressive ideas. And they're all ideas that have failed over and over and over again.

HANNITY: You told me -- what did Mayor Koch say?

GIULIANI: Mayor Koch said after six months of Mayor Dinkins being in office and people complaining about how the city was really falling part, he said the people have spoken, and now they must be punished.

(LAUGHTER)

HANNITY: Great. We're going to be punished on the federal level, congressional level, now in the city. All right, Mr. Mayor --

GIULIANI: Happy New Year.

HANNITY: -- great to see you. Appreciate it.

Content and Programming Copyright 2014 Fox News Network, LLC. ALL RIGHTS RESERVED. Copyright 2014 CQ-Roll Call, Inc. All materials herein are protected by United States copyright law and may not be reproduced, distributed, transmitted, displayed, published or broadcast without the prior written permission of CQ-Roll Call. You may not alter or remove any trademark, copyright or other notice from copies of the content.